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Is ProFunds Semicond UltraSector Service Class (SMPSX) a Strong Mutual Fund Pick Right Now?
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Sector - Tech fund seekers should not consider taking a look at ProFunds Semicond UltraSector Service Class (SMPSX - Free Report) at this time. SMPSX bears a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that SMPSX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversifies approach.
History of Fund/Manager
SMPSX is a part of the ProFunds family of funds, a company based out of Columbus, OH. The ProFunds Semicond UltraSector Service Class made its debut in June of 2000 and SMPSX has managed to accumulate roughly $4.69 million in assets, as of the most recently available information. The fund's current manager, Michael Neches, has been in charge of the fund since October of 2013.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 20.5%, and is in the top third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 21.13%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, SMPSX's standard deviation comes in at 28.78%, compared to the category average of -0.21%. The fund's standard deviation over the past 5 years is 28.07% compared to the category average of 1.31%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. SMPSX lost 74.41% in the most recent bear market and underperformed its peer group by 7441%. This might suggest that the fund is a worse choice than its peers during a bear market.
Even still, the fund has a 5-year beta of 1.8, so investors should note that it is hypothetically more volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a positive alpha over the past 5 years of 7.64, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, SMPSX is a no load fund. It has an expense ratio of 2.44% compared to the category average of -53.31%. SMPSX is actually more expensive than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $15,000; each subsequent investment has no minimum amount.
Bottom Line
Overall, ProFunds Semicond UltraSector Service Class ( SMPSX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and higher fees, this fund looks like a poor potential choice for investors right now.
Want even more information about SMPSX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is ProFunds Semicond UltraSector Service Class (SMPSX) a Strong Mutual Fund Pick Right Now?
Sector - Tech fund seekers should not consider taking a look at ProFunds Semicond UltraSector Service Class (SMPSX - Free Report) at this time. SMPSX bears a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that SMPSX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversifies approach.
History of Fund/Manager
SMPSX is a part of the ProFunds family of funds, a company based out of Columbus, OH. The ProFunds Semicond UltraSector Service Class made its debut in June of 2000 and SMPSX has managed to accumulate roughly $4.69 million in assets, as of the most recently available information. The fund's current manager, Michael Neches, has been in charge of the fund since October of 2013.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 20.5%, and is in the top third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 21.13%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, SMPSX's standard deviation comes in at 28.78%, compared to the category average of -0.21%. The fund's standard deviation over the past 5 years is 28.07% compared to the category average of 1.31%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. SMPSX lost 74.41% in the most recent bear market and underperformed its peer group by 7441%. This might suggest that the fund is a worse choice than its peers during a bear market.
Even still, the fund has a 5-year beta of 1.8, so investors should note that it is hypothetically more volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a positive alpha over the past 5 years of 7.64, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, SMPSX is a no load fund. It has an expense ratio of 2.44% compared to the category average of -53.31%. SMPSX is actually more expensive than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $15,000; each subsequent investment has no minimum amount.
Bottom Line
Overall, ProFunds Semicond UltraSector Service Class ( SMPSX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and higher fees, this fund looks like a poor potential choice for investors right now.
Want even more information about SMPSX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.